BILL ANALYSIS Ó
SENATE JUDICIARY COMMITTEE
Senator Hannah-Beth Jackson, Chair
2015-2016 Regular Session
SCA 12 (Runner and Huff)
Version: April 13, 2016
Hearing Date: May 3, 2016
Fiscal: Yes
Urgency: No
RD
SUBJECT
University of California: California residents
DESCRIPTION
This measure proposes a constitutional amendment that would
require the Regents of the University of California, as
administrators of a public trust, to act in the best interests
of the people of California. This measure would require the
regents to honor their fiduciary duty to California residents
who aspire to take advantage of the University of California's
promise of a high-quality college education by ensuring that
priority in admissions is given to applicants who are California
residents. This measure would make other technical or
non-substantive changes.
BACKGROUND
On March 29, 2016, the California State Auditor released a
report entitled, The University of California: Its Admissions
and Financial Decisions have Disadvantaged California Resident
Students. According to that report:
The University of California (university) is one of the
premier public university systems in the nation, enrolling
more than 252,000 students at its 10 campuses as of the fall
of 2014. As a public institution, the university should serve
primarily those who provide for its financial and civic
support-California residents. However, over the past several
years, the university has failed to put the needs of residents
first. In response to reduced state funding, it has made
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substantial efforts to enroll more nonresident students, who
pay significantly more annual tuition and mandatory fees than
resident students-$37,000 compared to $12,240 in academic year
2014-15. The results are stark: From academic years 2010-11
through 2014-15, total nonresident enrollment at the
university increased by 82 percent, or 18,000 students, while
resident enrollment decreased by 2,200 students, or 1 percent.
The report lists among its key findings that the university has
undermined its commitment to residents in an effort to increase
its revenue by recruiting and enrolling non-residents and
specifically cites the following:
total nonresident enrollment increased by 82 percent (or
18,000), while resident enrollment decreased by 1 percent (or
2,200 students) from academic years 2010-11 through 2014-15;
from academic years 2005-06 through 2014-15, nonresident
undergraduate enrollment increased 432 percent while during
the same time period resident enrollment increased only 10
percent. In academic year 2014-15, nearly one-third of the
students the university admitted were nonresidents;
despite a 52 percent increase in resident applicants, resident
enrollment increased by only 10 percent over the last 10 years
while non-resident enrollment increased by 432 percent;
total nonresident enrollment increased by 82 percent, while
resident enrollment decreased by 1 percent;
the University modified its admission standard for
non-residents and admitted nearly 16,000 non-residents over
the past three years with lower academic qualifications than
the median for admitted residents; and
from academic years 2005-06 through 2014-15, the university's
campuses denied admission to nearly 4,300 residents whose
academic scores met or exceeded all of the median scores for
nonresidents whom the university admitted to the campus of
their choice. (See California State Auditor, Report 2015-107,
The University of California: Its Admissions and Financial
Decisions Have Disadvantaged California Resident Students
(Mar. 29, 2016)
[as of
Apr. 27, 2016].)
This measure now seeks to put forth of the California voters a
constitutional amendment to require the regents of the
University of California to honor their fiduciary duty to
California residents who aspire to take advantage of the
University of California's promise of a high-quality college
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education by ensuring that priority in admissions is given to
applicants who are California residents.
This bill was heard in the Senate Education Committee on April
20, 2016, and approved on a vote of 6-0.
CHANGES TO EXISTING LAW
Existing federal law , the U.S. Constitution's Privileges or
Immunities Clause, provides that no State shall make or enforce
any law which shall abridge the privileges or immunities of
citizens of the United States. (U.S. Const., 14th Amend., Sec.
1, cl. 2.)
Existing federal law , the U.S. Constitution's Commerce Clause,
grants Congress the power to regulate commerce "with foreign
nations, and among the several states, and with the Indian
Tribes." (U.S. Const., art. 1, Sec. 8, cl. 3.) The dormant
Commerce Clause is inferred from that clause under the theory
that this grant of power implies a negative converse-a
restriction prohibiting a state from passing legislation that
improperly burdens or discriminates against interstate commerce.
Existing law , Article IX of the California Constitution,
establishes the UC as a public trust to be administered by the
Regents of the UC and grants the Regents full powers of
organization and government, subject only to such legislative
control as may be necessary to ensure security of its funds,
compliance with the terms of its endowments, statutory
requirements around competitive bidding and contracts, sales of
property and the purchase of materials, goods, and services.
(Cal. Const. art. IX, Sec. (9)(a).)
This measure would, contingent upon voter approval, amend the
California Constitution to require the Regents of the University
of California, as administrators of a public trust, to act in
the best interests of the people of California. This measure
would require the regents to honor their fiduciary duty to
California residents who aspire to take advantage of the
University of California's promise of a high-quality college
education by ensuring that priority in admissions is given to
applicants who are California residents.
This measure would make other technical or non-substantive
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changes.
COMMENT
1. Stated need for the bill
According to the author:
The UC includes on its admissions website the following
notice:
As a public institution, we prioritize admission for
California residents. Notwithstanding this declaration,
California students and parents share a growing perception
that seats at the University of California are being sold to
the highest bidder; that California students are being passed
over for less qualified non-residents who are willing to pay
more. In recent years the nine undergraduate campuses of the
University of California system have attracted an ever growing
number of out of state and international students applying for
freshman seats. In 2014 and again in 2015 the number of
California students enrolling as freshman declined while the
number of both out of state and international freshman
increased. Between 2010 and 2015 the system-wide number of
California undergraduates has declined marginally while the
number of nonresident undergraduates has surged by more than
20,000 students. The nonresident fees paid by these students
provide the University of California almost $500,000,000.00
(half a billion dollars) in additional revenue each year.
The [proposed] constitutional provision will read: As
administrators of a public trust, the regents shall act in the
best interests of the people of California. The regents shall
honor their fiduciary duty to California residents who aspire
to take advantage of the University of California's promise of
a high-quality college education by ensuring that priority in
admissions is given to applicants who are California
residents.
2. Fourteenth Amendment's Privileges or Immunities Clause:
right to travel
This measure, if approved by the voters, would require that the
state's public universities give priority to California
residents (over non-residents). The Supreme Court has long
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recognized that the Constitution, together with the nature of
the federal union, protects the right to travel throughout the
U.S., uninhibited by statutes, rules, or regulations that
unreasonably burden or restrict this movement. In Saenz v. Roe
(1999) 526 U.S. 489, 500 the Court detailed that the right
encompasses at least three components: (1) the right to enter
and to leave another state; (2) the right to be treated as a
welcome visitor rather than an unfriendly alien when temporarily
present in the second State; and, (3) for travelers who elect to
become permanent residents, the right to be treated like other
(longer) citizens of that State.
This third aspect of travel (the right of new residents to be
treated the same as longer residents of the state) is protected
by the 14th Amendment's privileges or immunities clause. (Id.
at 502.) Thus, it is constitutionally impermissible for a state
to enact durational residency requirements for the purpose of
inhibiting the migration by needy persons into the state.
Further, the Court has held that a classification having the
effect of imposing a penalty on the exercise of the right to
travel violates the Equal Protection Clause unless it is shown
to be necessary to promote a compelling governmental interest.
(Id. at 499.) In Saenz, specifically, the Court held that while
the plaintiffs were new to California, they had the right to be
treated the same as long-time residents, noting that there was
no reason for the state to fear that citizens of other states
would take advantage of California's relatively generous welfare
benefits because the proceeds of each welfare check would be
consumed while the plaintiffs remained within the state. Even
still, however, the Court distinguished welfare benefits them
from a "readily portable benefit, such as a divorce or a college
education," for which durational residency requirements have
been upheld in other cases. (Id. at 505, citing Sosna v. Iowa
(1975) 419 U.S. 393; Vlandis v. Kline (1973) 412 U.S. 441.)
Notably, this bill does not have a durational requirement of
residency-it merely requires that a person be a California
resident. The Court has repeatedly distinguished residency
requirements, which provide a benefit to current residents that
is not available to nonresidents, from durational residency
requirements. (See Chemerinksy, Constitutional Law Principles
and Policies (2011) 4th Edition, p. 888.) Accordingly, it is
unlikely that this bill would be deemed to infringe upon the
right to travel.
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3. Dormant Commerce Clause
The dormant Commerce Clause is the principle that state and
local laws are unconstitutional if they place an undue burden on
interstate commerce. While there is no constitutional amendment
that expressly makes this declaration, the Supreme Court has
inferred this principle from the grant of power to Congress to
regulate commerce among the states under Article I, Section 8 of
the U.S. Constitution. The modern approach to the clause gives
the court significant discretion and involves a balancing of the
benefits of the law against the burdens it imposes on interstate
commerce. How the balancing is done, however, depends on
whether the law discriminates against out-of-staters or treats
in-staters and out-of-staters alike. (Chemerinksy,
Constitutional Law Principles and Policies (2011) 4th Edition,
p.439-440.)
Accordingly, the dormant Commerce Clause usually involves the
following analysis: First, does the state law discriminate
against interstate commerce by treating out-of-staters
differently than in-staters, and thus burden interstate
commerce? Second, if the law does not discriminate, then the
presumption is in favor of upholding the law and it will be
invalidated only if it is shown that the burden on interstate
commerce outweighs the benefits of the law. Third, if the law
is discriminatory, then there is a strong presumption against
the law and a court will uphold it only if it is necessary to
achieve an important governmental purpose. The court will also
look at whether there were alternative nondiscriminatory means
available. (Id. at 441.)
"The central rationale for the rule against discrimination is to
prohibit state or municipal laws whose object is local economic
protectionism, laws that would excite those jealousies and
retaliatory measures the Constitution was designed to prevent."
(C&A Carbone v. Town of Clarkstown (1994) 511 U.S. 383, 389.)
Accordingly, as reflected above, in a dormant Commerce Clause
case, a court is initially concerned with whether the law
facially discriminates against out-of-state actors or has the
effect of favoring in-state economic interests over out-of-state
interests. Discriminatory laws are almost always declared
unconstitutional, and will be allowed only if the bill is
necessary (the least restrictive means), to achieve a
nonprotectionist purpose, under a strict scrutiny analysis.
(Chemerinksy at 460.)
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Here, while the proposed measure would discriminate under the
first prong of the test above, following the third prong, there
is arguably an important governmental interest in ensuring that
state residents have access to an affordable, high-quality,
public, higher education institution. In other words, it does
not appear that the bill is solely about economic protectionism
which would be in violation of the dormant commerce clause.
Whether this proposed constitutional amendment furthers that
interest in the least restrictive manner would likely depend on
what constitutes "priority." (See Comment 4.) Arguably,
whether or not this measure would be considered sufficiently
narrow to the bill's stated compelling interest is ultimately a
question for the courts.
4. Priority
Given that this bill sets forth a constitutional amendment
before the voters, and not legislation that could be readily
clarified when problems of interpretation arise, the authors may
wish to consider adding further clarity as to what "priority"
means and when "priority" must be given. Would priority mean
preference if all other things are equal between two candidates?
Or might it mean accepting all California resident applicants
before admitting any non-residents? As a matter of public
policy, absolute clarity is arguably a necessity as these public
universities could foreseeably face suit for failure to meet
their fiduciary duty to California's students. Moreover, to
ensure that this constitutional amendment would withstand a
challenge under the federal constitution's dormant commerce
clause also likely depends upon the specificity of this term.
Support : None Known
Opposition : None Known
HISTORY
Source : Author
Related Pending Legislation : None Known
Prior Legislation : SCA 22 (Rubio, 2012) would have proposed a
state Constitutional Amendment to add a new section to Article
IX of the State Constitution that would require that out-of
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state undergraduate students make up no more than 10 percent of
the total undergraduate enrollment, and no more than 10 percent
of the incoming class at each campus of the University of
California, beginning with the 2013-14 academic year. The bill
died in the Senate Education Committee without a hearing.
Prior Vote : Senate Education Committee (Ayes 6, Noes 0)
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